Economic growth of 6% will remain elusive–report
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HE Philippine economy must grow by at least 6.06 percent this year to achieve the government’s target of a lower debt-to-GDP ratio, but such growth rate may be “unrealistic,” according to De La Salle University (DLSU). In its report on the Philippine economy for March, DLSU said its Philippine High Frequency Model does not project economic growth beyond 6 percent. The university forecasts the Philippine economy to grow by 5.8 percent in 2025, below the government’s target range of 6 to 8 percent. “This is due to the lack of significant changes in the latest available indicators, which show no clear
signs of higher economic growth. We continue with our ‘wait and see’ attitude,” DLSU said. The economy expanded by 5.6 percent in 2024, bringing the deficit-to-GDP ratio to 5.7 percent, above the government’s 5.6 percent target. “Achieving a deficit-to-GDP ratio lower than 5.32 percent given a budget deficit of P1.54 trillion would require a GDP growth rate of no less than 6.06 percent,” it said. Last year, the budget deficit eased by 0.4 percent to P1.506 trillion from P1.512 trillion in 2023. This is 1.48 percent higher than the government’s expectations of a P1.48-trillion deficit in 2024.
“The reduction in the fiscal deficit does not necessarily mean that the Philippines has a better-managed economy,” DLSU said. This is because the government’s finances are different from those of a household or a firm, for whom a permanent deficit is untenable, it added. DLSU said a deficit occurs when the private sector seeks to net save and/or net import. Decisions made by the nongovernmental sector, not by government spending, result in a fiscal deficit. “Targeting a fiscal deficit is of not much use. Budget or Finance cannot decide it,” DLSU said. “The real problem of an economy [what leads to crises] is not a fiscal deficit unless the government
is borrowing foreign currency, and this cannot be paid back—not the case of the Philippines now but a private sector deficit. This is what the Philippine government should monitor and watch out for,” it added. DLSU said reducing the government’s fiscal deficit should not be viewed as a key indicator of sound economic judgment or excellent economic performance. “Instead of making fiscal consolidation a priority, the government should recognize that what really matters is how it is managing its spending to support what the Philippine economy really needs—which is attaining and sustaining faster economic growth in the long run,” it said. Reine Juvierre S. Alberto
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‘INFLATION MAY QUICKEN ON COSTLY DUBAI CRUDE’ E
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By Reine Juvierre S. Alberto @reine_alberto
XPENSIVE oil imports and the weak peso will cause inflation to accelerate and even breach the government’s target this year if the price of Dubai crude hits $100 per barrel, according to the Bangko Sentral ng Pilipinas (BSP). In its Monetary Policy Report from its February meeting, the BSP said inflation could exceed the 2 to 4 percent target range in the latter part of the year. As such, the BSP revised upward its baseline inflation forecast for 2025 to 3.5 percent from 3.3 percent. “The anticipated decline in rice prices from tariff reductions is expected to help guide inflation towards the midpoint of the target range in the first half of 2025,” the central bank said. However, higher global oil and non-oil prices, peso depreciation and above-expectation inflation print recorded in December 2024 and January 2025 caused the upward revision of BSP’s inflation expectations. The increase in Dubai crude oil prices will also lead to inflation exceeding the government’s targets, considering only direct effects and not potential second-round impacts, the BSP said. The BSP estimates inflation will reach 4.1 percent in 2025 if Dubai crude oil prices would hit $100 per barrel. Inflation in 2026 could settle at 4.2 percent if the price of Dubai oil hits $85. Meanwhile, potential increases in electricity rates, transport charges and pork prices were identified as upside risks to the inflation forecast for 2025 and 2026. See “Inflation,” A2
LEAVING ON A JET PLANE Overseas Filipino workers at NAIA Terminal 1 are deep in thought while some are taking photos using their smartphones prior to their departure. A senator is moving to expand the compulsory insurance coverage for agency-hired overseas Filipino workers to also include rehires, direct hires and government hires. PHOTO BY NONIE REYES
SAN MIGUEL IS PHL TOP POWER GENERATION COMPANY–ERC By Lorenz S. Marasigan
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IVERSIFIED conglomerate San Miguel Corp. (SMC) has taken the lead as the largest power generation company in the country, according to the Energy Regulatory Commission (ERC). Data from the regulator showed that the Ang-led conglomerate’s market share in the national grid is now at 22.44 percent with a generation capacity of 6,079 MW. It was followed by Aboitiz Equity Ventures Inc. at 21.75 per-
cent share (5,894 MW), First Gen Corp. at 13.22 percent (3,582 MW), Manila Electric Co. at 5.42 percent (1,467 MW), and Ayala Corp. at 5.28 percent (1,431 MW). SMC also dominated the Luzon grid at 28.42 percent share (5,519 MW), followed by Aboitiz (4,797 MW), First Gen (2,688 MW), Ayala (1,257 MW), and Meralco (775 MW). In the Visayas, First Gen held the largest market share at 23.2 percent (785 MW), followed by Meralco (691 MW), Aboitiz (457 See “San Miguel,” A2
DA finds low compliance with pork MSRP By Ada Pelonia
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@adapelonia
HE Department of Agriculture (DA) said only a fifth of retailers in Metro Manila followed the maximum suggested retail price (MSRP) for pork imposed by the government. Citing the latest report from the DA’s Agribusiness and Marketing Assistance Service, Agriculture Assistant Secretary Arnel de Mesa said only 20 percent of over 170 Metro Manila stalls monitored have complied with the MSRP for pork. He added that the compliance with MSRP for “sabit ulo” at P300 per kilo, or the price at
which traders pass on pork to retailers, stood below 10 percent. “If they are not compliant with ‘sabit ulo,’ therefore (retailers) would really have a hard time complying with the MSRP of P350 to P380 (per kilo). So, we will focus on that,” De Mesa told reporters in a press briefing on Monday. He noted that the farmgate price of pork was already on a downward trend and has fallen to as much as P220 per kilo from P250 per kilo. “So, this means the prices agreed upon during the meetings were not followed based on the level of compliance,” he said. He noted that the DA will hold
another meeting to determine the causes for the low compliance rate despite holding consultations with stakeholders. However, De Mesa also noted that the agency is mulling over allowing the government to intervene in the market if high retail pork prices would persist. This would be done through the Food Terminal Inc. (FTI) which will purchase local pork and sell it at a lower price. The DA imposed the MSRP on pork in Metro Manila wet markets starting March 10 at P380 per kilo for pork belly or liempo and P350 per kilo for kasim or pork shoulder and pigue or pork ham. The agency said the move to
impose an MSRP on pork aims to ease the financial strain on consumers reeling from the surge in meat prices. Furthermore, the DA said it decided to impose an MSRP on pork following consultations with industry stakeholders, such as producers, wholesalers, traders, and retailers, who said this move would ensure the pork industry’s sustainability, which continues to suffer from the ASF’s adverse effects. Retail prices of pork ham in Metro Manila markets range from P340 to P410 per kilo, while pork belly is being sold at P355 to P470 per kilo, based on the latest government price monitoring report.
PESO EXCHANGE RATES n US 57.2480 n JAPAN 0.3849 n UK 74.0388 n HK 7.3651 n CHINA 7.9118 n SINGAPORE 42.9274 n AUSTRALIA 36.2094 n EU 62.3030 n KOREA 0.0394 n SAUDI ARABIA 15.2645 Source: BSP (March 28, 2025)